Deck 4: Supply Processes and Technology

Question 1

An online catalog is a digitized version of a supplier's catalog that can be customized to include the specific items,prices,and other terms and conditions negotiated by the buyer and seller.

Answer 1

True

Question 2

Efficient and effective supply processes are needed because of:

A)the large volume of items and dollar value.
B)severe consequences of poor performance.
C)the potential contribution to organizational objectives.
D)the need for an audit trail.
E)the large volume of items,dollar value,severe consequences of poor performance,the potential contribution to organizational objectives,and the need for an audit trail.

Answer 2

E

Question 3

Expediting:

A)may be caused by the buyer or the supplier.
B)is caused by buyer behavior only.
C)is caused by supplier behavior only.
D)may be the result of legal noncompliance.
E)is a routine order tracking process.

Answer 3

A

Question 4

Poor internal compliance with the supply process:

A)indicates that staff in other functional areas are not qualified for their jobs.
B)has nothing to do with the process itself.
C)is caused by top management's failure to mandate compliance.
D)may indicate that internal customers do not trust the process or suppliers.
E)has nothing to do with organizational structure.

Question 5

Electronic data interchange (EDI)provides:

A)secure transmission of large amounts of data,but with slow turnaround.
B)slow processing of large amounts of data,but with greater accuracy.
C)longer process cycle time,but with greater accuracy.
D)secure transmission,greater accuracy,and shorter process cycle time for all data.
E)secure and rapid transmission of small amounts of data.

Question 6

Blanket purchase orders:

A)reduce costs by decreasing the number of purchase orders issued.
B)cover multiple purchase requirements on one order.
C)are difficult to prepare.
D)reduce costs by decreasing the number of purchase orders issued and cover multiple purchase requirements on one order.
E)reduce costs by decreasing the number of purchase orders issued,cover multiple purchase requirements on one order,and are difficult to prepare.

Question 7

The greatest opportunity to affect value in the purchasing process is when:

A)needs are recognized and described.
B)potential suppliers are identified and analyzed.
C)the suppliers are selected.
D)price and terms are determined.
E)the buyer follows-up and expedites the order.

Question 8

Improving the efficiency and effectiveness of the process for small value orders can be achieved through:

A)vendor/supplier managed inventory systems.
B)the use of purchasing cards.
C)eliminating all small value orders completely.
D)vendor/supplier managed inventory systems and the use of purchasing cards.
E)vendor/supplier managed inventory systems,the use of purchasing cards,and eliminating all small value orders completely.

Question 9

Small dollar value purchase orders can be efficiently and effectively managed by implementing an e-procurement system.

Question 10

The application of pressure on a supplier to meet the original delivery promise,to deliver ahead of schedule,or to speed up delivery of a delayed order is called follow-up.

Question 11

A request for proposal is used when there is a clear and unambiguous description of need.

Question 12

The payment process:

A)and the supply process should be aligned in policy and practice.
B)should always be owned and managed by accounts payable.
C)should always be owned and managed by supply.
D)must include paper invoices to avoid legal liability.
E)has little impact on supply management.

Question 13

Making the procure-to-pay (P2P)process as seamless as possible can:

A)reduce order cycle times.
B)increase administrative costs.
C)improve satisfaction of internal customers and suppliers.
D)reduce order cycle times and improve satisfaction of internal customers and suppliers.
E)reduce order cycle times,increase administrative costs,and improve satisfaction of internal customers and suppliers.

Question 14

If the buyer has a clear and unambiguous description or specification,and wants to find out which supplier can deliver the best value when and where needed,he or she will typically issue a:

A)request for proposal (RFP).
B)request for information (RFI).
C)request for bid (RFB).
D)request for price (RFP).
E)request for quotation (RFQ).

Question 15

Traveling requisitions are used for:

A)sales people on business trips.
B)service parts orders.
C)recurring requirements and standard parts.
D)maintenance,repair,and operations parts (MRO)orders.
E)sales people on business trips,service parts orders,recurring requirements and standard parts,maintenance,repair,and operations parts (MRO)orders.

Question 16

One purpose of a requisition is:

A)to request or requisition supplies from external suppliers.
B)to give users a way to authorize buyers to acquire goods and services.
C)to clarify the description of need before communicating with potential suppliers.
D)to solicit price quotes for goods or services from suppliers.
E)to give finance a way to have the final say in any decision to spend money.

Question 17

An extranet is a private internet that is extended to authorized users outside the company,such as suppliers.

Question 18

Effectively and efficiently applying technology to the supply management process will:

A)lead to increased clerical effort from additional data entry.
B)lead to damaged buyer-supplier relationships from impersonal communication.
C)lower the total cost of doing business.
D)inhibit negotiation planning because of time spent accessing and analyzing data.
E)decrease operating performance because of the volume of available information.

Question 19

Information flows:

A)only into the supply group from other internal functions.
B)between and among supply,and other internal functions and external sources.
C)only back and forth between supply and other internal functions.
D)only into the supply group from external sources.
E)only back and forth between supply and external sources.

Question 20

Online reverse auctions are best suited for situations where:

A)specifications are clearly defined.
B)there is a competitive supply market with qualified suppliers willing to participate.
C)the buyer is prepared to switch suppliers if necessary.
D)specifications are clearly defined and there is a competitive supply market with qualified suppliers will to participate.
E)specifications are clearly defined,there is a competitive supply market with qualified suppliers willing to participate,and the buyer is prepared to switch suppliers if necessary.

Question 21

Pareto analysis usually reveals that 70-80 percent of transactions account for 10-15 percent of spend.

Question 22

It is relatively easy to develop a global database to consolidate volumes and sourcing strategy because common technical standards and government regulations exist across countries.

Question 23

The first step in optimizing the supply process is to build internal consensus around the opportunities to add value to the organization.

Question 24

An online reverse auction may require significant upfront preparation and cost.

Question 25

A master service agreement (MSA)is a type of open-ended purchase order.

Question 26

The terms and conditions included in a purchase order from a company do not vary from purchase to purchase,regardless of what goods or services are being acquired.

Question 27

A process is a set of activities that has a beginning and an end,occurs in a specific sequence,and has inputs and outputs.

Question 28

Maverick buying is a talented member of the supply department whose creativity and innovations have saved the organization large sums of money.

Question 29

A requisition is a gatekeeping tool to manage the flow of information through three gates:
(1)authority, (2)internal clarity,and (3)internal clearance.

Question 30

The costs of radio frequency identification (RFID)tags and the ability to capture reliable data are both barriers to the adoption of RFID systems.